IMT-N-I-12-MM1

Marketing Management 1
Session II

Learning Objectives
1.

Marketing Myopia

2.

Selling Vs Marketing

3.

Marketing Fundamentals

2.1 Marketing Myopia

"focusing on products rather than customers

Short sighted businesses fail
Top level managements fail in their long term orientation,
lose sight of what customers want
Henry Ford & the Mass Production of Model-T
Market provides growth opportunities not growth industries
Companies need to capitalize on growth opportunities
If a buggy whip manufacturer in 1910
defined its business as the "transportation starter business,
they might have been able to make the creative leap
necessary to move into the automobile business
when technological change demanded it

Marketing Myopia, Theodore Levitt, HBR, July-Aug 1960

2.2 Selling Vs Marketing

Selling: Transaction C.

Marketing: Value Concept

Starts with seller & product

Starts with customer & need

Finds right customers for

Finds right product for the

product
Caveat Emptor
Customer is last link in
business
Begins with existing
products
Ends at sale transaction
Makes profit by aggressive
selling
Looking at the mirror

customers
Caveat Vendor
Customer is very purpose of
business
Begins with product idea
Ends at customer
satisfaction
Makes profit by satisfying
needs
Looking outside the window

2.3 Marketing Fundamentals

STP
Marketing Mix
Marketing Environment
Customers
Competition

STP

Segmenting
Population shows variety seeking behavior
High degree of heterogeneity prevails in society
Marketers select segment of opportunity
Subsets of consumers with common needs
Targeting
Level, Timing & Nature of select groups demand
One or more segments to pursue
Demand Management & Customer Management
Positioning
Choose a value proposition
Differentiate- USP, position & communicate

Marketing Mix

Product

Promotion

Product Variety

Sales promotion

Product Quality

Advertising/ Publicity

Product Design & Features

Public Relations

Branding, Labeling & Pckg

Direct Marketing

Service, Guarantee &

Warranties

Price
List price
Credit & Discounts
Payment period

Place
Channels & Coverage
Warehousing
Transportation

Marketing Mix
Product
Price
Place
Promotion

Offer Mix

Promotion Mix
(Communication Mix)

Customer Satisfaction & Value

Customer value = Benefits / Resources

=

Functional Benefits + Emotional Benefits

(Monetary + Time + Energy + Psychic) Costs

Superior Customer Value

Raise benefits
Reduce costs
Raise benefits & reduce costs
Raise benefits by more than the raise in costs
Lower benefits by less than the reduction in costs

Marketing Environment

Company & Employees

Financers & Bankers
Research & Development
Material Suppliers
Service Suppliers
Channel Partners
Location
Consumers

Internal Environment
Micro Environment
Task Environment

Political-Legal Envt.
Economic Envt
Socio-Cultural Envt.
Technological Envt.
Demographic Envt.
Natural Envt.

External Environment
Macro Environment
Broad Environment

Mega Environment

Customers

Cognitive Customer
Information processor

Economic Customer
Rational decision maker

Passive Customer
Marketers influence

EPS
Extensive Problem Solving

LPS
Limited Problem Solving

RRB
Routine Response Behavior

Emotional Customer
Impulsive decisions

Customer

Impulse Buying

Buying Situations

Competition

Brand Competition
All other brands in same category
Industry Competition
Category Competition
Form Competition
Sector Competition
Generic Competition
Genres competing for money

References:

Marketing Myopia
Theodore Levitt, HBR, July-Aug 1960.